New data shows that an average Manhattan apartment now costs over 25 % less than last year—around $1.25 million. Sales are now down by more than half, and housing values are expected to plummet on average 29.5 % in 2009, according to Housing Predictor. Even rental vacancies are up, spurred no doubt by the scramble on the part of developers of many would-be condo projects all over the city to convert them into rental buildings.
But if these statistics seem dreadful, consider this: HP just upgraded its forecast for Manhattan by 3 %, while the fate of the other boroughs is, while perhaps not yet sunny, certainly less devastating. The Bronx, Brooklyn, Staten Island and Queens are projected to decline an average of 15.8 %. Further out of the city, where real estate prices did not gallop away quite as far during more prosperous times, the downswing is also not as steep: home prices in Buffalo, where almost half of all sales are foreclosures, is predicted to fall 12.2 % in 2009, while Albany is forecast to deflate 9.6 % and Rochester just 8.8 %. In Syracuse, despite rising layoffs, prices are forecast to drop 9.1 % and its homes are now some of the best values in the state. The buyers, it seems, are coming back, buoyed by low-interest rates and emboldened by the first-time buyer’s tax credit doled out by the federal government.
Some of the more desirable markets, however, are still forecast for significant declines. Long Island homes are projected to deflate 20.3 % in 2009, while in Glen Falls, popular during boom times with bonus-laden Wall Streeters eyeing multi-million-dollar homes, prices are forecast to fall a total of 18.9 % for the year. Nonetheless, it appears at least the acceleration of the freefall is over, and a less tumultuous real estate market can be expected in 2010.